Kraken lays off employees ahead of IPO
The cryptocurrency exchange platform Kraken has quietly conducted a series of layoffs over the past few months, eliminating several hundreds of positions across its departments. This workforce reduction, which began in October 2023 with the departure of approximately 15% of employees (around 400 people), is part of a larger effort to make the company more agile, profitable, and well-positioned for an imminent IPO in the United States.
A large-scale rationalization strategy
According to sources close to the matter, the downsizing did not stop there. The new leadership duo, Arjun Sethi and David Ripley, implemented an ongoing cost optimization process aimed at eliminating organizational duplication and improving performance indicators, including EBITDA (earnings before interest, taxes, depreciation, and amortization). The ambition is clear: to transform Kraken into a more efficient player to attract public investors.
The strategic shift of Kraken driven by new leadership
The change in leadership at Kraken marks a rupture in the company’s governance. Jesse Powell, the iconic co-founder, stepped down in 2023, paving the way for a more managerial approach embodied by Arjun Sethi, an experienced investor from Silicon Valley, and David Ripley, the former COO. Together, they expressed the need to simplify the company’s structure, reduce unnecessary hierarchies, and accelerate decision-making.
This transformational drive is reflected in the successive adjustments made since then. Far from being a one-time reaction, the downsizing plan is conceived as a progressive and continuous restructuring. For Kraken, it is not a retreat, but a strategic refocusing.
A redefined growth around new products
Despite this apparent austerity, Kraken continues to strengthen its portfolio of activities. The company has made a series of announcements, including the acquisition of NinjaTrader, a platform specialized in derivative products, and the upcoming launch of a stock trading service. These initiatives demonstrate both a willingness to diversify and an active search for more recurring and stable revenues, a key asset ahead of an IPO.
A spokesperson for Kraken emphasizes:
We have never launched so many products, our revenues are growing strongly, and we continue to recruit in strategic areas.
The company claims to manage its workforce rigorously and discerningly, prioritizing skills deemed essential to its expansion.
An IPO in the sights of the crypto sector
Kraken is not the only crypto company structuring itself to enter the stock market. In a context of market recovery and renewed interest in digital assets, several sector players, such as Circle, are sharpening their financial and operational arguments to attract public markets.
In this context, Kraken’s choices reflect a coherent strategy: reducing fixed costs, accelerating organic growth, and enhancing the company’s attractiveness to traditional investors. The question remains whether this discipline will be sufficient to convince in a sector still marked by volatility and regulatory uncertainties.
